Budget 2013/14 Northern Territory Economy
Tabled paper 295
Tabled Papers for 12th Assembly 2012 - 2016; Tabled Papers; ParliamentNT
Tabled by David Tollner
Made available by the Legislative Assembly of the Northern Territory under Standing Order 240. Where copyright subsists with a third party it remains with the original owner and permission may be required to reuse the material.
Department of the Treasury and Finance
External Economic Environment 29 Northern Territory Economy External Economic Environment The Northern Territory has a relatively small, open economy that is influenced by international trade flows, large engineering projects, tourism and population movements that in turn depend on broader national and international economic conditions. The performance of the national economy is particularly important to the Territory as approximately 80percent of the Territory Governments revenue is derived from receipts from the goods and services tax and other Commonwealth revenue, which in turn depend on national economic activity. After increasing by 3.6percent in 2012, the International Monetary Fund (IMF) is forecasting yearonyear economic growth in Australia to slow to 3.0percent in 2013 before strengthening to, and stabilising at, 3.2percent from 2014 through to 2016. The primary driver of growth over the next five years is expected to shift from private investment, especially in the mining sector, to net exports. This is due to the completion of a number of major projects in the mining (mainly iron ore) and manufacturing (mainly new liquefied natural gas plants) sectors and as output and exports from these industries increase accordingly. The IMF is forecasting global economic growth to slightly increase from 3.2percent in 2012 to 3.3percent in 2013, reflecting the prolonged stagnation in the euro area and the slowerthanexpected growth in the emerging market and developing economies that continue to weigh on growth. Despite forecasts of relatively weak levels of economic activity in Japan and the European Union, global economic growth is expected to strengthen to 2015 before returning to longterm trend levels in 2016. 2011 2012 2013f 2014f 2015f 2016f Real GDP growth (% change)1 Australia 2.4 3.6 3.0 3.3 3.1 3.1 China 9.3 7.8 8.0 8.2 8.5 8.5 European Union 1.6 0.2 0.0 1.3 1.7 1.8 Japan 0.5 1.9 1.6 1.4 1.1 1.2 United States 1.8 2.2 1.9 3.0 3.6 3.4 Advanced economies 1.6 1.3 1.2 2.3 2.6 2.6 Emerging market and developing economies 6.4 5.1 5.3 5.7 6.0 6.1 Global 4.0 3.2 3.3 4.0 4.4 4.5 Exchange rate2 AUD/USD 1.03 1.03 1.04 1.04 1.01 1.00 Trade weighted index 76 77 78 78 76 74 GDP: gross domestic product; AUD: Australian dollar; USD: United States dollar; f: forecast 1 Calendar year 2 Year ended June Note: Data excludes defence. Source: IMF; ABARES; ABS; Consensus Forecasts Chapter 3 Key points